DES MOINES, Iowa (Legal Newsline) - Iowa workers’ compensation law preempts lawsuits over sexual harassment at work, the Iowa Supreme Court ruled, throwing out a $400,000 jury verdict a telemarketing employee won over unwanted advances by her supervisors.
Saying workplace harassment is like “one more industrial mishap in the factory,” the state high court ruled the Iowa Workers’ Compensation Act is the only way for employees to recover damages for physical or emotional damages.
Jena McCoy sued Thomas L. Cardella after she felt forced to quit over her team leader’s unwanted sexual advances. She missed the 300-day deadline for filing hostile work environment claims under the Iowa Civil Rights Act and her lawyers tailored her claims to avoid ICWA, which channels most workplace injury claims into a streamlined system for compensation. She sued Cardella for negligent hiring and retention, arguing she suffered emotional damages because the telemarketing firm failed to respond to her claims of harassment.
Cardella moved to dismiss her case, first over the missed ICRA deadline, then arguing her claims were preempted under IWCA. The trial court rejected both motions and a jury found McCoy had suffered assault and battery at the hands of a supervisor and was entitled to $400,000 in emotional damages.
Cardella appealed, and the Iowa Supreme Court, in a June 16 decision, reversed the judgment.
“McCoy shifted, and reshifted, her theory of liability and related damages, adopting and eschewing aspects from both the ICRA variant of her claim and the IWCA variant as necessary to form a claim that is neither quite one nor the other,” the court wrote. “We acknowledge the jury’s conclusion that McCoy was harmed by her experience at Cardella. But she cannot avoid the statutory processes for seeking redress against her employer by manipulating common law theories to reach the jury.”
The court didn’t address the ICRA deadline, focusing only on preemption under the workers' comp law. In previous decisions, the high court extended preemption to injuries stemming from workplace horseplay, including a Winnebago Industries employee who was hurt when his coworkers taped him to a chair and dropped him on the way to a shower where they planned to soak him. The important thing isn’t how a lawsuit is drafted, the high court ruled, but whether the injuries occurred in the workplace.
“To the employer, an intentional tort by one employee against another `is just one more industrial mishap in the factory, of the sort he has a right to consider exclusively covered by the compensation system,’” the court concluded. “If the essence of the action is recovery for physical injury or death, including in `physical’ the kinds of mental or nervous injury that cause disability, the action should be barred even if it can be cast in the form of a normally non-physical tort.”
The court also rejected the “imported quarrel” exception under Iowa workers’ compensation law for injuries stemming from a dispute with roots outside the workplace.
“McCoy only knew (her supervisor) through her employment at Cardella, so his conduct could not have been `based on a personal relationship outside the working environment,” the court concluded.